I have the utmost respect to people who makes UPI work. Made even the old people in the nation completely go digital for payments - a feat unparalleled in the world.
As GP says, you could _never_ get the older generation to use a credit card even when they had the means to do so. But they took to UPI just fine, and many now prefer it over cash.
Also, credit card issuance and acceptance in India is growing quite a bit right now, despite (because?) of UPI.
Network rules disallowing customer surcharges have actually become prohibited by law in quite a few places.
Yes India got credit cards but it was not widespread and people did not use it as a daily thing since most stores/outlets did not have the card swiping system. UPI solved this problem very well since you just need a QR code and a valid bank account and no transaction charges making it perfect for day to day spending.
We got digital payments and smartphones together. But in the US for example, credit cards came much earlier and were able to capitalize very well since there wasn't a lot of the technology at that time which we take for granted today.
People up until one-two generations ago completely rejected the use case for credit cards for payment, since they just did not want to swallow the premise of using credit as a payment instrument. If that doesn't happen, credit cards do not take off (just as what you are saying). The problem wasn't as much as systems were not available; systems were available but people did not want it. Merchants swallow the cost if the demand comes (this is what is happening right now; credit cards are becoming mainstream despite UPI being there, because younger generation loves using them, and more merchants than before are allowing credit cards on UPI even though they can reject them, because people want to use credit on UPI as well). People at that time just did not want to use credit, so merchants had no incentive to bear costs. Kali Mody brought Diners Club to India in 1961 (my father has fond memories of that instrument). CBI introduced the first bank-issued credit card in the eighties. The system was _always_ there. People just didn't feel they wanted to use it.
People also forget that UPI is not just for consumer-to-merchant. It's also a P2P system, which credit cards definitely aren't.
You make a system that people want, people will use. People used UPI.
You seem to either not have an understanding of ground reality (if your father was using Diners Club in the 60s, he was in the elite). But the system "being" there vrs the environment of the system actually being useful are different things. People did not reject credit cards at that time due to idealogical reasons, they rejected it because there was no point for them.
By the time, we stepped up in commerce, digital payments like UPI were easily available. This is why most people say we skipped the credit card phase and went straight to digital payments. Nobody is saying India did not have credit cards but look at adoption rates and the economic reality of India in the 60s to 90s and you will see many factors that prevented this that are not realated to the technolgy or idealogy at all.
Well, I wouldn't say "elite", but well off (at that time), but that still doesn't mean that card networks couldn't have made themselves useful if they/the government wanted to. Poverty is not a gating mechanism. Plenty of poor people in the US use credit cards - they practically fund the rewards system since they cannot pay on time - and I seem to remember that the first Americards were figuratively dropped from the skies, regardless of the holder's income or debt levels, which was then used to coax merchants into accepting them. Such sort of "growth" tactics would not have had an effect here since neither the government nor RBI would allow it, nor would the people take too kindly to it. And let's not disparage people for not understanding ground reality. What I'm saying still has basis in fact, just possibly not the facts you seem to care about. The point about people not wanting to use credit cards still stands. Just talk to someone > 60 years old and you'll get the drift. Many wouldn't touch a revolving credit feature here even if it was forcefully handed to them and they could easily use it. As much a fan my dad was of Diners Club, he still told me to not touch a credit card until I had at least twice as much income as expenses.
I don't disagree with you entirely, and your points are not the reason I talk about the sixties and eighties; I talk about them because many people seem to think that India did not have the systems there at all, and that India did not have enough well-off people in the past at all, or that India did not have any sort of knowhow or capability to introduce systems like credit cards (and make it work for quite a bit of the population) at all. That part is incorrect. The systems were there, they just failed for the "hundreds of millions" at that time while still working for the "few million", plus they still hung around enough to succeed now because clearly the potential was always there. Just because they didn't catch on quickly did not mean that they weren't there or were not useful to a subsection of the population. You cannot just go "straight to the digital payments phase" without acknowledging that things were there and what their trajectories were. People seem to forget that relative small scale "of solving problems" for India in terms of adoption is large-scale for other countries. A single-digit percentage acceptance in this country can swallow many countries' populations, poor or otherwise.
Visa and Mastercard payment rails are somewhat disjoint, even for large Indian companies. As a foreigner, there's always been a huge acceptance gap vs many other countries when you want to use a card.